County audit flags late room-tax filings; DA opens investigation

An outside financial reviewer told the Nye County Board of County Commissioners on June 17 that an agreed-upon-procedures engagement had found nearly $87,000 in unassessed late fees on short-term lodging tax returns across the county for 2021–2024. The reviewer said the counts of occurrences and dollar totals rise sharply in 2023–24 and that the details need further examination.

The county retained accountant Dan McArthur to perform the agreed-upon procedures. McArthur told the board his work examined county records of lodging tax reports and whether late-filing penalties had been assessed and collected. He said his review found instances in which returns appeared to be delinquent and penalties were not assessed or collected. “In total, looking across the towns, the amounts that appear to have not been assessed or collected for late filing are approximately $86,900 for the four-year period,” McArthur said. He clarified his work was not a forensic audit and that his findings were based on county documentation rather than direct contact with lodging operators.

Several public speakers urged a full, independent investigation and possible prosecution if misconduct is found. Karen Waldman of Tonopah said the problem was concentrated in one commission district and asked who authorized waiving the fees. “Someone made the decision to waive these fees without the authority to do so,” she said, calling for accountability and restitution to affected towns.

District Attorney: will investigate

Nye County’s district attorney told the board he would undertake a full investigation. He emphasized the need to avoid premature conclusions, noting there are legitimate limited circumstances under which late‑filing penalties may not apply, such as when late payment is beyond a taxpayer’s control. “There’s a lot of nuance here, and it does deserve a full and complete evaluation,” he said, adding that his office would work with the auditor to gather the necessary records and follow the evidence.

Board members and members of the public pressed for more transparency. Commissioners asked for details about which lodging operators and which towns were affected, whether mail‑handling or internal processing caused apparent late filings, and whether a matrix of responsibilities exists in the treasurer’s office. McArthur and county staff said the next steps include compiling more detailed documentation and coordinating with the DA, and the DA said his office would pursue a complete inquiry and report back to the board.

What the review did and did not do

McArthur said his engagement consisted of specific agreed-upon procedures and was not a forensic investigation. He reviewed records in county possession to flag delinquencies and instances where penalties did not appear to have been assessed. He did not contact individual lodging operators as part of this work; doing so would be part of a broader forensic or enforcement inquiry.

Board response and next steps

Commissioners said they had asked for the review and that it was appropriate to place the findings before the board. Several commissioners and members of the public asked the DA to proceed quickly because some towns, including Tonopah, rely on room taxes and have already requested accounting. The DA acknowledged that some previously issued legal guidance about automatic penalties had been incorrect and reiterated that his office would investigate, focusing on whether late filings were beyond taxpayers’ control and whether county procedures for receipt and processing of payments were followed.

The board did not vote on enforcement actions during the meeting; the DA said his office would move forward with the investigation and report back to the board with findings and any recommended next steps.